friend or foe - apics fox river...friend or foe november 18, 2009 2 ctdi confidential the the “...

1CTDI Confidential

12/30/2009

Le

an

T

ran

sfo

rmati

on

-F

rie

nd

or

Fo

e

Le

an

L

ean

T

ran

sfo

rmati

on

T

ran

sfo

rmati

on

--F

rie

nd

or

Fo

eF

rie

nd

or

Fo

e

November 18, 2009

2CTDI Confidential

The

The

The

The “ “““House of Lean

House of Lean

House of Lean

House of Lean” ”””– –––Strong Foundation for Growth

Strong Foundation for Growth



3CTDI Confidential

What is Lean?

What is Lean?

What is Lean?

What is Lean?

�“L

ean

is a

n u

nen

din

g jo

urn

ey t

o b

e t

he m

ost

inn

ovati

ve,

mo

st

eff

ecti

ve a

nd

eff

icie

nt

org

an

izati

on

. T

he P

ow

er

an

d

Ma

gic

of

Lean

is t

o c

on

tin

ually d

isco

ver

the h

idd

en

op

po

rtu

nit

ies e

xis

tin

g a

ll a

rou

nd

yo

u.”

»N

orm

an

Bo

dek,

Au

tho

r

4CTDI Confidential

July 16, 2009

A Chronology of Lean








�E

li W

hit

ney

1799

�Part Standardization

�F

red

eri

ck W

. T

aylo

r1890

�Tim

e Study

�H

en

ry F

ord

1910

�Mass Production

�W

. E

dw

ard

s D

em

ing

1950

�SPC/14 Pts & 7 Sins

�Jo

sep

h J

ura

n1952

�TQM

�T

aic

hii

Oh

no

1950 -1972

�JIT/TPS

5CTDI Confidential

�Read about it in a book.

�Learned about it at a conference.

�Heard about it from a friend.

�Received a visit from a consultant.

�Was a topic in a class.

�Will solve all of our problems.

Reasons to Convert to Lean???




6CTDI Confidential

Why Convert to Lean?




�Helps control/reduce organizational costs and improve cash

flow.

�Provides a basis for continuous improvement.

�Fully utilizes the knowledge potential of the organization.

�Increases organizational flexibility.

�Provides additional potential for growth.

�Provides the potential for a competitive advantage.

7CTDI Confidential

Steps to a Successful Lean Conversion




�Executive management understanding, support and

conviction.

�Sim

ple, yet difficult process.

�Dramatic culture change.

�INVESTMENT for the future.

�Not a “Flavor of the M

onth”.

�Ongoing process requiring long-term

commitment.

�Establish the Vision, Mission and Goals for the organization.

�Why are w

e doing this and what do w

e expect to accomplish?

8CTDI Confidential

�Develop Overall Implementation Plan.

�Who, What, W

hen, Where, How M

uch?

�Identify and acquire/develop needed resources.

�Outside expertise

�Customers, supplie

rs, consultants, practitioners

�Develop internal expertise

�Partner with above for education and exp

erience





9CTDI Confidential

�Education of employees (all levels).

�Reasons for the lean conversion

�Business reasons

�“W

hat’s in it for me?”

�Management structure changes

�Value stream versus traditional

�Lean tools and techniques

�Expectations of transform

ation

�Psychological im

pacts of change





10

CTDI Confidential

�Identify “Value Streams”

�Group Technologies (families)

�Products w

ith sim

ilar processes and process flow

�Identify Value Stream Teams

�Manager

�Primary support functions (quality, maintenance, engineering,

etc.)





11

CTDI Confidential

�Begin Transformation

�PQ Analysis

�Representative product for study

�80/20 rule

�Identify/Understand Current State

�Value Stream M

ap (adds value or waste?)

�Identify Future State

�Value Stream M

ap

�Kaizen





12

CTDI Confidential

�Sustain and Improve

�Develop standardization

�Strategic

�Tactical

�Develop Metrics –Measure Progress

�Strategic

–Vision & M

ission

�Tactical (S, Q, D, C)

–Day to day





13

CTDI Confidential

�Culture of Continuous Improvement

�Never satisfied

�Always strive for perfection

�Never accept excuses

�Find and understand root causes

�Repeat the cycle –

repeat, repeat, repeat





14

CTDI Confidential

Potential Roadblocks




�“WE’RE THE BEST!”

�“We’ve always done it this way.”

�“We can’t afford to spend the money.”

�“This applies only to production. It doesn’t apply to me.”

�“We’re a service organization. We don’t manufacture.”

�“We’re already lean. We have only the people we need.”

15

CTDI Confidential

Success Stories

Success Stories

Success Stories

Success Stories

�Office Seating Manufacturer

�Additional Results

�Closed three seating facilities

�Discontinued seating production in two additional

facilities.

1997

2005

% Change

Annual Sales (Manufactured)

$70M

$200M

+186%

Total Units Produced

900K

2M

+122%

Total SKUs Produced

17K

26K

+53%

Total Floor Space

200K

200K

NC

Total Employees

450

420

-7%

COT to Customer

98.00%

99.95%

+2%

Customer Defect PPM

6500

620

-90%

16

CTDI Confidential

�Saw Blade Manufacturer

�Focus

�Verification of orders (confirmed vsMRP)

�One order flow

�FIFO

Success Stories

Success Stories

Success Stories

Success Stories

May 2006

June 2006

July 2006

August 2006

% Change

Daily Manufacturing Capacity (units)

13000

13000

13000

13000

NC

Shipping Backlog (days)

65

56

22

1-98.5%

Shifts Worked per Week

14

14

10

10

-28.6%

17

CTDI Confidential

�Accounting Department (H

iring Decision)

�Request for additional person to complete weekly reports.

–32 hours work for 14 reports (verified via tim

e study)

–Person working 28 hours overtim

e weekly

�Verified actual use of reports (from 14 to 4)

�Identified need for reports (from 4 to 2)

�Identified source of inform

ation (balance sheet)

�Created m

acro to provide in

form

ation –

electronic

�Reduced paper usage (52 reams annually)

�Elim

inated need for overtim

e ($26,000 annual savings)

�Elim

inated need for additional person ($70,000 cost avoidance)

Success Stories

Success Stories

Success Stories

Success Stories

18

CTDI Confidential

12/30/2009

CT

DI E

lgin

-L

ean

T

ran

sfo

rmati

on

CT

DI E

lgin

C

TD

I E

lgin

--L

ean

L

ean

T

ran

sfo

rmati

on

T

ran

sfo

rmati

on

19

CTDI Confidential

12/30/2009

Project Plan

Project Plan

Project Plan

Project Plan

20

CTDI Confidential

12/30/2009

Project Plan

Project Plan

Project Plan

Project Plan

21

CTDI Confidential

part

#DE

SCRIP

TION

BU

Scan at dockSmall Receipt Dock (Receive Confirmation)Large Receipt Dock (receive confirmation)Trash Compactor / BailerReceiving (PO verification)IQANon Confoming Material StorageSC01 StorageSC02 StorageYantra S LocationPrepPrepackFabpackReturnsMezzanineCarousel Pods 1&2Carousel Pods 3,4,5,6Mini 1,2,3Mini 4,5,6,7,8,9MSSIISorterDropDCAFlow Rack RadiosPick to Tote RadioPostponementBlue Lines pack benchRBR Pack outCanopyLDCRentalMitek / MeshRebandingAntenna StorageDomestic Shipping SquaresDomestic OverpackInternational Shipping squaresInternational Shipping Over packConsolidation LoopManifestDockCQACommercial InvoiceDynamic Cycle countCustomer ComplianceRTs ReplenElgin North

01

23

45

68

910

1112

1314

1516

1718

1920

2122

2324

2526

2728

2930

3132

3334

3536

3738

3940

4142

4344

4546

Radi

o Lin

e 4,5

,6,7

Radi

o Pi

ck, p

ack &

ship

GP&S

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

LAH6

5KDC

9AA2

AN

EP45

0 146

-174

MHZ

5W 16

CHGP

&Sx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

x

LAH6

5RDC

9AA2

AN

EP45

0 438

-470

MHZ

4W 16

CHGP

&Sx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

x

RBR

Reta

il Bus

sines

s Rad

io P

ick, P

ack &

Ship

GP&S

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

HKBN

4020

A RB

R RE

TAIL

LG.B

ACC

Y PK

G KI

TGP

&Sx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

x

HKBN

4011

A

LARG

E B G

AP P

ACKI

NG K

ITGP

&Sx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

x

Parts

& A

cces

sorie

sPa

rts pi

ck, p

ack &

ship

GP&S

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

0102

709J

83

VOL &

ROTA

TY SW

ITCH

GP&S

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

5175

249A

04

IC RO

M3 Z

EUS B

ASEB

AND

PROD

UCTIO

NGP

&Sx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

x

Cano

pyCa

nopy

pick

ing, p

rogr

aming

,pack

ing &

Shipp

ingGP&

Sx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

x

27RD

DAS

SY,PR

D OT

H,RE

FLEC

TOR D

ISH KI

TGP

&Sx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

x

2400

SMDD

ASSY

,ASS

Y,2.4

GHZ S

UB M

ODUL

E, AD

JUST

ABLE

PWR S

ET TO

HI

GP&S

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

Lapt

ops

Com

pute

r, pic

king,

conf

igurin

g, pa

cking

& Sh

ippingGP

&Sx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

x

HK13

22A

ML9

10 RU

GGED

NOT

EBOO

K PC

GP&S

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

HKLN

4389

AM

L910

MID

-TIER

DOC

K KIT

(HKL

N431

0)GP

&Sx

xx

xx

xx

xx

xx

xx

xx

xx

xx

xx

x

Elgin Group Technologies




12/30/2009

Radio Products

P&A

Specialized Services

22

CTDI Confidential

Insert here your

Current Plant Wide

Block Layout

Insert here your

Future Plant Wide

Block Layout

R E C E I V I N G

S H I P P I N G

R E C E I V I N G

S H I P P I N G

Current Plant Wide Block Layout

Future Plant Wide Block Layout

12/30/2009

Block Layout

Block Layout

Block Layout

Block Layout

23

CTDI Confidential

12/30/2009

Radio Products Value Stream Spaghetti








Diagrams

Diagrams

Diagrams

Diagrams

Diagrams

Diagrams

Diagrams

Diagrams

�Current Spaghetti Diagram

�Future Spaghetti Diagram

24

CTDI Confidential

12/30/2009

Spaghetti Diagram

Spaghetti Diagram

Spaghetti Diagram

Spaghetti Diagram – –––Pick & Pack

Pick & Pack

Pick & Pack

Pick & Pack

C U

R R

E N

TF

U T

U R

E

Picke

rPac

ker

Rep

lenish

er

Water Spide

rPick / P

ack

25

CTDI Confidential

12/30/2009

Radio Product Current Value Stream








Map

Map

Map

Map

Map

Map

Map

Map

Supplier

Customer

Motorola ERP

(Oracle)

Truck Shipment

CTDI Whse

Mgmt System

(Yantra)

Schedule Share

COF

MOL

Call

Center

FCR

Mot Web M

ethods

E2 O

pen

CTDI Web M

ethods

Drop DCA

Queue

Inventory (#) : 4860 Pieces

Inventory Tim

e : 480.000 M

inutes

Queue

Sort by region

(Shipping

Conveyor)

Cycle Tim

e : 6.000 M

inutes

NVA Tim

e : 6.000 M

inutes

Number of Machines / Station : 1.000

Machines


Distance Traveled : 635.000 Feets

Number of Operators : 1.000 Staff

Warehouse

Racks

inventory turns : 5.500 Per Year

Pack radio kit

Cycle Tim

e : 9.580 M

inutes

NVA Tim

e : 1.250 M

inutes


Other




Move

to

Shipping

Cycle Tim

e : 2.000 M

inutes

NVA Tim

e : 2.000 M

inutes


Machines



Order Pick

(10 radio order, 10

touches per radio)

Cycle Tim

e : 2.920 M

inutes

NVA Tim

e : 2.920 M

inutes


Other




Queue


Inventory Tim

e : 480.000 M

inutes

Truck Shipment

Postponement

Cycle Tim

e : 15.000 M

inutes

NVA Tim

e : 0.000 M

inutes

Number of Machines / Station : 3.000 O

ther


Mini L

oads

Cycle Tim

e : 38.500 Seconds

Number of Machines / Station : 10.000 M

achines


Create

Docu

mentatio

n

(Domestic or

Internatio

nal)

Cycle Tim

e : 120.000 Seconds

NVA Tim

e : 0.000 M

inutes


ther



Box Build

Stations

Cycle Tim

e : 0.270 M

inutes

NVA Tim

e : 0.270 M

inutes


achines




Compro

(Radio

Programming)

Cycle Tim

e : 1.880 M

inutes

NVA Tim

e : 0.270 M

inutes


achines




Blue Line

replenish

Cycle Tim

e : 30.000 Seconds

NVA Tim

e : 30.000 Seconds


achines




Warehouse

Pick

Cycle Tim

e : 42.000 Seconds

NVA Tim

e : 42.000 Seconds


achines


Inventory Tim

e : 5.000 Days



Conso

lidate /

Ove

r-pack order

Cycle Tim

e : 66.000 Seconds

NVA Tim

e : 66.000 Seconds


ther



Sorter

Cycle Tim

e : 88.600 Seconds


achines


Carouse

l

Cycle Tim

e : 41.600 Seconds


achines


Load Truck

Cycle Tim

e : 10.000 Seconds


achines



Kaizen

Kaizen

Kaizen

Kaizen

Kaizen

Kaizen

26

CTDI Confidential

12/30/2009

Radio Products Future State Value








Stream Map

Stream Map

Stream Map

Stream Map

Stream Map

Stream Map

Stream Map

Stream Map

27

CTDI Confidential

12/30/2009

Incoming Receiving Current State








Support Stream Map

Support Stream Map

Support Stream Map

Support Stream Map

Support Stream Map

Support Stream Map

Support Stream Map

Support Stream Map

28

CTDI Confidential

12/30/2009

Incoming Receiving Future State MOI








Support Stream Map

Support Stream Map

Support Stream Map

Support Stream Map

Support Stream Map

Support Stream Map

Support Stream Map

Support Stream Map

29

CTDI Confidential

12/30/2009

Incoming Receiving SOI Future State

Incoming Receiving SOI Future State

Support Stream Map

Support Stream Map

30

CTDI Confidential

Current & Future Metrics




12/30/2009

Vie

wM

etr

ics

Pa

ram

ete

rC

urr

en

tF

utu

reIm

pro

ve

me

nt

Mo

t /

CT

DI

Co

stT

ota

l D

L T

ime

Pe

r T

ou

ch3

9.0

6 s

eco

nd

s3

0.6

5 s

ec

21

.5%

Mo

t /

CT

DI

De

liv

ery

To

tal

Dis

tan

ce T

rav

ele

d3

16

02

21

23

0%

Mo

t /

CT

DI

De

liv

ery

Jid

ok

a (

Lin

e C

ha

ng

e O

ve

r T

ime

)N

/A

20

min

ute

s

Mo

t /

CT

DI

Co

stS

pa

ce U

tili

zati

on

44

,51

1 s

q f

t3

4,2

66

sq

. ft

.2

3%

Mo

t /

CT

DI

Co

stS

OI

con

ve

rsio

n t

o M

OI

10

Da

ys

2 D

ay

s8

0%

Mo

t /

CT

DI

Qu

ali

tyD

QP

PM

42

93

52

18

%

Mo

t /

CT

DI

De

liv

ery

On

Tim

e D

eli

ve

ry9

9.0

0%

99

.31

%3

1%

Mo

t /

CT

DI

Sa

fety

OS

HA

re

cord

ab

le r

ate

00

0%

Mo

t /

CT

DI

Qu

ali

ty5

S e

va

lua

tio

n s

core

1.3

3.5

26

9%

Ra

dio

Pro

du

cts

Va

lue

Str

ea

m L

ea

n T

ran

sfo

rma

tio

n O

bje

ctiv

es

31

CTDI Confidential

12/30/2009

Drop DCA

Drop DCA

Drop DCA

Drop DCA

Drop DCA

Drop DCA

Drop DCA

Drop DCA

Previous Condition

Current Condition

Process Improvements

1)Dedicated Blue Line locations within the warehouse for high running parts

2)Moved Drop DCA into allocated locations within the warehouse

3)Devised a process to remove empty pallets

32

CTDI Confidential

12/30/2009

Existing Pack Cell

Existing Pack Cell

Existing Pack Cell

Existing Pack Cell

Existing Pack Cell

Existing Pack Cell

Existing Pack Cell

Existing Pack Cell

Existing Pack Stations

Existing Pack Station

33

CTDI Confidential

12/30/2009

Current Pilot Pack Station

Current Pilot Pack Station

Process Improvements

1)Combined pick and pack functions into one station

2)Created Kanban (2 Bin System)

3)Ergonomic Redesign of the workstation to minimize rotation from

computer monitor to packaging

34

CTDI Confidential

Value Stream Core Team Members




VALU

E STREAM: R

adio Produ

cts

Nam

eTitle

Joleen

Wes

tValue

Strea

m

Man

ager

Ernie Sch

arlau

Sup

erviso

r

Mag

da M

anits

Qua

lity Spe

cialist

Jenn

ifer Jo

hnso

nMainten

ance

Tec

h

Way

ne Asp

len

Tec

h Ops

VALU

E STREAM: D

ata Produ

cts

Nam

eTitle

TBD

Value

Strea

m

Man

ager

Lydia Le

wan

dowski

Sup

erviso

r

Naran

Patel

Qua

lity Spe

cialist

TBD

Mainten

ance

Tec

h

TBD

Tec

h Ops

VALU

E STREAM: P

arts & Acces

sorie

s

Nam

eTitle

Gary Balsa

vich

Value

Strea

m

Man

ager

Mon

ika Van

de Poe

leSup

erviso

r

Gerrado

Artea

gaQua

lity Spe

cialist

TBD

Mainten

ance

Tec

h

And

y Mec

iej

Tec

h Ops

12/30/2009

35

CTDI Confidential

12/30/2009

Lean Training Curriculum








Topic

Target DateON PLANBEHIND

AHEADTarget DateON PLANBEHIND

AHEADTarget DateON PLANBEHIND

AHEAD

Team Building

9/1/2009

Yes

10/6/2009

11/3/2009

5S9/1/2009

Yes

10/6/2009

11/3/2009

Lean 101

9/1/2009

Yes

10/6/2009

11/3/2009

Value Stream Creation and Design

9/2/2009

Yes

10/7/2009

11/4/2009

Problem

Solving

9/2/2009

Yes

10/7/2009

11/4/2009

Kanban

9/2/2009

Yes

10/7/2009

11/4/2009

Standard Work

9/2/2009

Yes

10/7/2009

11/4/2009

The Gem

ba Mindset

9/3/2009

Yes

10/8/2009

11/5/2009

Kaizen

9/3/2009

Yes

10/8/2009

11/5/2009

Poka Yoke

9/3/2009

Yes

10/8/2009

11/5/2009

Specialized Services

STATUS

STATUS

Radio Products

STATUS

Parts & Accessories

36

CTDI Confidential

12/30/2009

Direct Replenishment Team








37

CTDI Confidential

12/30/2009

Training Sessions

Training Sessions

Kaizen Training Exercise

38

CTDI Confidential

12/30/2009

Training Sessions

Training Sessions

Training Sessions

Training Sessions

Training Sessions

Training Sessions

Training Sessions

Training Sessions

Standard Work

Waste Identification

39

CTDI Confidential

12/30/2009

Summation

Summation ––Radio Value Stream

Radio Value Stream

Creating a True Pull System

–Current State is Batch & Q

ueue

�Reduce overall inventory levels

�MOI & SOI (replenish superm

arket)

�Reduce lead tim

e

�Optimize m

anning

�Better serve the needs of the customer

�Decisions supported and verified by actual data

�Future state prepares the Elgin DC for an optimized Supply

Chain where manufacturing sites and suppliers replenish the

“Supermarket”based on a pull system.

40

CTDI Confidential

Lean Consultants/Resources




�IMEC (Illinois Manufacturing Extension

Center)

�Bradley University

�428 JobstHall

�Peoria, IL 61625

�(888) 806-9632

�info@

imec.org

�Shingijutsu USA

�355 Horizon Cr.

�Grass Valle

y, CA 95945

�(530) 274-8207

�fred@

fredharrison.com

�Simpler

�2814 O

ak M

eadow D

rive

�Suite 201

�Ottumwa, IA 52501

�(888) 532-6888

�carrolld

@sim

pler.com

�Air Academy Associates(6 Sigma)

�1650 Telstar Drive, suite 110

�Colorado Springs, CO 80920

�(800) 748-1277

�aaa@

airacad.com

friend or foe - apics fox river...friend or foe november 18, 2009 2 ctdi confidential the the “...

Documents